# Loan-to-Value (LTV) Ratio Management: Risk-Adjusted Limit Structures

> FRFIs must establish LTV limit structures aligned with the risk profiles of various mortgage types, as outlined in their Residential Mortgage Underwriting Policy (RMUP).

Category: Strategy
Last verified: 2026-02-18
Source: https://ratellow.com/faqs/strategy/loan-to-value-ltv-ratio-management-risk-adjusted-limit-structures

## Answer
FRFIs must establish LTV limit structures aligned with the risk profiles of various mortgage types, as outlined in their Residential Mortgage Underwriting Policy (RMUP). OSFI expects average LTV ratios to remain below stated maximum thresholds. Mortgage insurance is mandatory for mortgages exceeding an 80% LTV ratio.

## Related guide
- https://ratellow.com/guides/mortgage-insurance-life-disability

## Sources
- Mortgage insurance — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017#2.5.1
- Footnotes — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/capital-adequacy-requirements-car-guideline-2026
- Page 2 — https://assets.cmhc-schl.gc.ca/sf/project/cmhc/pdfs/factsheets/new/cmhc-quick-reference.pdf#page=2
- OSFI exempts uninsured mortgage straight switches from the prescribed MQR and implements portfolio LTI limits — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/osfi-exempts-uninsured-mortgage-straight-switches-prescribed-mqr-implements-portfolio-lti-limits